Forward this to your small business friends.
From: Congresswoman Katherine Clark <MA05KCIMA(a)mail.house.gov>
Date: Monday, April 27, 2020 at 2:03 PM
Subject: Getting COVID-19 Relief to Your Local Business
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Hello Friend,As the coronavirus (COVID-19) pandemic continues to cause incredible financial hardship for our businesses, non-profits, and workers, I want to update you on my work in Congress to address these challenges and connect you to some relevant resources that are available for you and your loved ones. Helping our small businesses is key to keeping millions of Americans employed and on payroll throughout this crisis, and last week, Congress passed the Paycheck Protection Program and Health Care Enhancement Act to make over $360 billion in additional aid available to local businesses in short order. House Democrats fought to ensure that this bill included resources for small and medium-sized community banks and credit unions so that companies who have preexisting relationships with large corporate banks don't get special treatment while our Main Street businesses get left behind. Here's a rundown of the grants, loans, and resources available to you:Click on these shortcuts below
to quickly find resources that are relevant to you. Paycheck Protection Program (PPP) Loans Emergency Injury Disaster Loans and Emergency Economic Injury Grants Guidance for Businesses that Already Applied For Relief SBA Debt Relief Program SBA Express Bridge Loans Small business counseling and training
Minority Business Development Agency (MBDA) counseling and training Paycheck Protection Program (PPP) Loans:
PPP was created under the CARES Act and provides access to capital to cover the cost of retaining employees during the COVID-19 pandemic. Congress provided an additional $310 billion to PPP when it passed the Paycheck Protection Program and Health Care Enhancement Act yesterday.
These are low-interest, zero fee loans of up to $10 million with a deferred repayment of at least six months, and up to 100% of the PPP loan principle can be forgiven if borrowers follow the forgiveness guidelines and maintain certain employee and wage levels.
The loan can be used to cover up to 8 weeks of payroll expenses and any new Economic Injury Disaster Loan balances under $10 million.
Borrowers can apply for loan forgiveness for the amount of payroll costs in addition to rent, mortgage interest, and utility costs sustained during an eight week period after the loan is disbursed.
Eligible applicants include businesses or nonprofits in operation on February 15, 2020, as well as small businesses, 501(c)(3) nonprofit organizations, and s501(c)(19) veterans organizations that have fewer than 500 employees. Sole proprietorships, independent contractors, and the self-employed are also eligible.
PPP loans will be calculated in different ways depending on the size of your business:
The loan size is 250% of average monthly payroll costs for the one-year period before the loan is made. If you're a seasonal worker, it is 250% of average monthly payroll costs from February 15, 2019, to June 30, 2019, or you can opt to choose March 1, 2019 as the time period start date.
If the business is less than a year old, the maximum loan is equal to 250% of your average monthly payroll costs between January 1, 2020, and February 29, 2020.
Eligible costs include compensation; payment for vacation or parental, family, medical, and sick leave; allowance for dismissal or separation; payment for group health care benefits, including insurance premiums; payment of any retirement benefit; and payment of State or local taxes assessed on the compensation of employees.
Businesses can use funds for the payroll costs above; payments of interest on any mortgage; rent; utilities; and interest on any other debt obligations that were incurred before February 15, 2020.
For more information from the Small Business Administration, click here.
To apply for a PPP loan, click here. You can also contact your local SBA District Office by clicking here.
For a state-by-state list of PPP lenders from the SBA, click here.
Emergency Injury Disaster Loans and Emergency Economic Injury Grants:
The Economic Injury Disaster Loan Program offers loans of up to $2 million to assist applicants impacted by COVID-19. The loans may be used to pay fixed debts, payroll, accounts payable, and other bills that are unable to be paid due to the pandemic. The interest rates for these loans are 3.75% for small businesses and 2.75% for non-profit organizations. The maximum term for loan repayment is 30 years.
The CARES Act also created a new $10 billion grant program within the Economic Injury Disaster Loan Program to provide quick advances of up to $10,000 for eligible entities that apply in order to help cover costs right away.
The emergency advances will be provided to eligible entities within 3 days of applying for an Economic Injury Disaster Loan, and they do not have to be repaid if it is used to keep employees on payroll, pay for sick leave, meet increased production costs due to supply chain disruptions, or pay business obligations like debts, rent, and mortgage insurance payments.
To access the grants, you must first apply for an Economic Injury Disaster Loan and then request the advance.
Eligible entities include businesses with 500 or fewer employees; sole proprietorships, with or without employees; independent contractors; cooperatives and employee-owned businesses; tribal small businesses; and non-profits of any size.
The SBA recommends that before beginning the application process, eligible entities should:
Contact vendors and work with them to get better payment terms than you currently have.
Contact your bank for a business plan (if you are approved for a loan at 3.75% or comparable rate, the SBA will not offer you something better).
Prioritize vendor payments according to the most crucial services and the vendor's ability to work on better terms of payment.
Make good faith payments to vendors and employees to stay as current as possible.
File their 2019 tax returns as quickly as possible.
Prepare income statements complete with monthly sales reports from 2019 and 2020 to date.
For more information from the SBA, click here. To apply, click here.
Guidance for Businesses That Already Applied for Relief
Starting today, SBA will resume processing Economic Injury Disaster Loan and Advance applications that are already in the queue on a first come, first-served basis. For those of you who have applied for an Economic Injury Disaster Loan but did not receive an approval or denial, your application should now be processed. If you do not know whether your application was successfully submitted, please confirm with your local SBA District Office, which you can contact by clicking here.
Starting today at 10:30am EDT, the SBA will resume accepting PPP applications from participating lenders. For those of you that applied for PPP relief who did not receive either a loan number or a denial, you should reach out to your lender to follow up. The lender may have held onto your application because they had been told by SBA that the funding had initially run out, and may be able to submit it now.
For PPP applicants who received a loan number, you should be receiving your money now that PPP funding has been replenished.
SBA Debt Relief Program:
Under the CARES Act, small businesses with existing non-disaster SBA loans like SBA 7(a), 504, and microloans will be given immediate relief through the SBA Debt Relief Program.
Under this program, SBA will cover all payments on these SBA loans, including principal, interest, and fees, for six months.
This relief will also be available to new borrowers who take out loans within six months of March 27, 2020.
Although PPP and SBA disaster loans are not eligible under this program, it is important to note that payments are already deferred under those loans.
Debt relief is automatic, but businesses should be sure to check in with their lender.
Under the CARES Act, the SBA is directed to make payments within 30 days of the date on which the first payment is due.
For more information from the SBA, click here.
SBA Express Bridge Loans:
If your small business already has a business relationship with an SBA express lender, you can apply for an SBA Express Bridge Loan to access up to $25,000 quickly. For more information from the SBA, click here.
Small Business Counseling and Training:
The CARES Act also allocated $265 million in funding for SBA resource partners like Small Business Development Centers (SBDC) and Women's Business Centers (WBC) to provide free counseling and training to small businesses impacted by COVID-19.
SBDCs are a national network of nearly 1,000 centers that provide counseling and training to new and existing businesses. Find out more about SBDCs by clicking here.
WBCs are a national network of more than 100 centers that offer counseling, training, networking, workshops, technical assistance and mentoring to entrepreneurs on multiple business development topics. In addition to women, WBCs serve the needs of underserved entrepreneurs, including low-income entrepreneurs. To find out more about WBCs, click here.
This additional CARES Act funding ensures that all counseling services are always free, and that the training provided through these partners is low in cost.
You can find your local small business resources partners by clicking here.
Minority Business Development Agency (MBDA) counseling and training
The CARES Act also dedicated $10 million in funding towards the creation of Minority Business Development Agency (MBDA) grants for counseling and training services that are specifically geared toward minority-owned small businesses impacted by COVID-19.
The MBDA promotes the growth of minority owned businesses through the mobilization and advancement of public and private sector programs.
For more information about MBDA business centers, click here. To find your local MBDA business center, click here.
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*It is my job to listen to Massachusetts families. Please click to take my survey to share your views and join my email list.
Please be sure to regularly check my dedicated COVID-19 webpage on my website for new health and public safety information as well as for additional resources as they arise. I promise to keep you updated as this situation evolves and will continue to do everything I can in Congress to protect American families from this virus.
Sincerely,
Katherine Clark
Member of Congress (MA-05)
Washington, DC Office
2448 Rayburn HOB
Washington, DC 20515
Phone: (202) 225-2836
Hours: M-F 9-5:30pmDistrict Office
157 Pleasant Street, Suite 4
Malden, MA 02148
Phone: (617) 354-0292
Hours: M-F 9-5:30pmMetroWest Regional Office
116 Concord Street, Suite 1
Framingham, MA 01702
Phone: (508) 319-9757
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